Industry super funds are being used as a vehicle to transfer millions of dollars to the union movement, with almost $20 million in fees paid out over four years. Worst still, industry funds do not provide transparency to their members of their disbursements or true costs. Simply, consumers are being kept in the dark and misled.
An Institute of Public Affairs report released showed unions received $18.4m in fees, dwarfing the $2m paid to industry groups and $5.6m paid out to third parties over the same period. The IPA report, Rivers of Gold, shows 70% of third-party payments fees went to trade unions between 2013 and 2017.
The Construction Forestry Mining and Energy Union received almost $3m, ahead of United Voice ($2.3m), Australian Council of Trade Unions ($2.05m) and the Maritime Union of Australia ($1m). Industry super funds were “being used as a vehicle to transfer millions of dollars from hardworking members to the trade union movement. Unfortunately, there is no transparency and members have no say on where their money goes. At a time when less than 10% of workers is a member of a trade union, it is clear the industry fund model has been very significantly undermined.
At present the government is trying in enact reforms will lift the standards of transparency, accountability and independent oversight of every single industry super fund in the country.
There is no industry super fund that properly discloses their true cost of operations. None of these costs are disclosed to their members. Often it is impossible to even know and where your money is invested. Another example is the massive annual budget spent on the “Compare the Two” campaign that that has continued to mislead consumers as the true cost of retail versus industry funds. This has repeatedly come to the attention of the ACCC and ASIC and these myths have been allowed to continue to the detriment of consumers.
Commenting on this, Stu Varidel, Principal Adviser of Heart Financial Advisers said; “Just because you see an industry super fund claim higher performance, does not mean that you should believe it. To this day, when industry super funds invest in the same assets as other super funds you can’t achieve a better outcome. Clearly, industry super funds are not transparent. With full transparent disclosure they logically must be hiding information. I can categorically show to any individual an industry super fund alternative that can give the same investment outcomes that are cheaper than what they are getting in their existing super fund. The best thing is you also get full disclosure of every cost and expense. You can be assured you are getting the real deal.”
Stu Varidel went on to say; “Advertising around industry super funds is not truthful and these same funds and don’t have the best interest of their members in minds. I sincerely hope that this is brought to light at the Royal Commission!”
If you want to discuss your super options, please call Heart on 1300 861 143.
This information is current as at 23/10/18. This article has been prepared by Heart1Stop, a social media brand owned by Heart Mortgage Services and Heart Financial Advisers. The information contained in this article is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The views expressed here are not those of Heart1stop, Heart Mortgage Services, Heart Financial Advisers, shareholders, directors or staff and associated contractors and business associates. This article has been prepared without taking into account any person’s objectives, financial situation or needs. Because of this, you should, before acting on any information contained in this article, consider its appropriateness, having regard to your objectives, financial situation or needs. Any taxation information contained in this article is a general statement and should only be used as a guide. It does not constitute taxation advice and is based on current laws and their interpretation. Each individual’s situation may differ, and you should seek independent professional taxation advice on any taxation matters. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. It is not the intention of Heart1Stop or Heart Mortgage Services and Heart Financial Advisers that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party of Heart1Stop or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties ("Third Parties") who are not related to Heart1Stop. These links are provided for convenience only and do not represent any endorsement or approval by us.